JERUSALEM (Reuters) - Hundreds of ultra-Orthodox Jews in Israel blocked highways and clashed with police on Thursday in protest at a government decision to cut funds to seminary students who avoid military service.

Ultra-Orthodox Jewish men attach a placard to a sign post during a protest in Ashdod February 6, 2014. The placard in Hebrew reads, "An end to the illusion of recruiting the ultra-Orthodox." REUTERS/Amir Cohen

Police arrested about three dozen demonstrators at a number of hot spots, including eight who threw stones at officers, and used water cannon to disperse a crowd blocking the main road to Jerusalem, police spokesman Micky Rosenfeld said.

The unrest followed a Finance Ministry decision on Wednesday to stop giving stipends to students undertaking religious studies, who for decades have been granted military service exemptions that have stoked resentment in a country whose other Jewish citizens are called to duty at the age of 18.

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The issue is at the heart of an emotional national debate.

“If you do not take on the duties, then why are you asking to get the privileges?” said Finance Minister Yair Lapid in a radio interview in an admonition to ultra-Orthodox Jews after halting the funding in line with a Supreme Court ruling.

The court had ordered the government to stop paying stipends to some seminary students, infuriating ultra-Orthodox community leaders who noted that in the absence of a new law, deferrals were still being issued by the Defence Ministry.

The ruling from the Supreme Court, which in 2012 struck down a “service deferral law”, demonstrated its dissatisfaction with foot-dragging in parliament over passage of new legislation that would open the way for wider enlistment of ultra-Orthodox men.